U.S. service industry indicators fall, business activity shrinks for the first time since the epidemic

The U.S. services sector stalled in September, business activity contracted for the first time since the outbreak, and orders barely rose.
Data released Friday by the Institute for Supply Management (ISM) showed the services sector index fell 2 points to 50, indicating stagnation. The figure was worse than the estimates of all economists surveyed.
The business activity index fell more than five points and fell into contraction territory for the first time since May 2020. The new orders index fell 5.6 points to 50.4, wiping out almost all of the previous month's gains. Export orders also fell.
Services, the largest component of the economy, performed disappointingly, with a separate report released earlier this week showing manufacturing activity contracting for a seventh consecutive month.
Orders and business activity slowed as employment shrank for a fourth consecutive month, although declines slowed in September.
Stronger orders and sales may be needed to encourage companies to hire more. As the U.S. government shutdown results in a lack of official data, economists and policymakers will rely more on reports from private institutions such as the ISM survey to provide insights into the job market and overall economic conditions.
Delivery times in September were also extended due to a surge in orders the previous month. The ISM supplier delivery index rose 2.3 points to its highest level since February. An indicator of order backlog, which fell to a 16-year low the previous month, rebounded, but remains in contraction territory.
The payment price index rose slightly to 69.4, one of its highest levels in three years.
At the same time, inventory indicators fell to their lowest level since the start of the year, although a related indicator showed a slight increase in concerns about excessive inventories.